Pharoah Construction was awarded a contract to construct an interchange at the junction of two major freeways in a Canadian cityat a total contract price of $10,140,000. The estimated total cost to complete the project is $8,112,000, and it is expected to taketwo years. Using the percentage-of-completion method and the cost-to-cost basis, prepare the journal entry to recognize the revenue andgross proft for the frst year.

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter3: Income Sources
Section: Chapter Questions
Problem 88P
icon
Related questions
Question

Pharoah Construction was awarded a contract to construct an interchange at the junction of two major freeways in a Canadian city
at a total contract price of $10,140,000. The estimated total cost to complete the project is $8,112,000, and it is expected to take
two years.

Using the percentage-of-completion method and the cost-to-cost basis, prepare the journal entry to recognize the revenue and
gross proft for the frst year. 

Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
CONCEPTS IN FED.TAX., 2020-W/ACCESS
CONCEPTS IN FED.TAX., 2020-W/ACCESS
Accounting
ISBN:
9780357110362
Author:
Murphy
Publisher:
CENGAGE L
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning